Home Health and Personal Care Services in Medicaid: Addressing Compliance Risks

One of the major concerns that policymakers deal with constantly in federal health care programs like Medicare and Medicaid is the risk of program fraud and abuse.  And although there are a plethora of statutes designed to address these concerns – the False Claims Act, the Anti-Kickback Statute and the Civil Monetary Penalties statute, to name a few – Congress, CMS and law enforcement are always on the lookout for ways to nip fraudulent activities in the bud.  In December of 2016, Congress took one such step as part of the 21st Century Cures law.

Section 12006 of the Cures law adds a new requirement for state Medicaid plans to require “electronic visit verification” (EVV) for home health and personal care services provided to Medicaid beneficiaries.  States that do not implement these systems (by 2019 for personal care services and by 2023 for home health services) put at risk a portion of their federal financing.  In return, the federal government will reimburse states for 90% of the costs of design, development and implementation of the system and 75% of the costs of operating and maintaining the system.

Before diving into the nuances of section 12006, a few words about home health and personal care services in Medicaid.  Both are optional benefits under Medicaid, although all states cover home health services and the majority of states cover personal care services (31 states had personal care services beneficiaries in 2014).  And there’s obviously a financial benefit to covering home health services and personal care services; after all, it’s cheaper to care for someone in their home than in a nursing home.  But home healthcare is not only the fastest growing service in the health care sector; it’s the fastest growing business in the US economy!  With that growth comes concern about substandard care, fraud and abuse.

In the Cures law, Congress stepped in and directed states to adopt EVV for home health and personal care services.  Under the legislation, an EVV is a system that electronically verifies the following data elements for these services:

  • The type of service performed;
  • The individual receiving the service;
  • The date of the service;
  • The location of service delivery;
  • The individual providing the service; and
  • The time the service begins and ends.

States cannot just spring the system on beneficiaries, their families, and health care providers.  There must be a stakeholder consultation process and an opportunity for training.  And the system must be minimally burdensome, take into account best practices (as determined by CMS and distributed to states), and be HIPAA-compliant.

Congress believed that a successful electronic visit verification (EVV) system both helps ensure vulnerable beneficiaries are receiving needed care and prevents Medicaid program dollars from being reimbursed for care not delivered.  The Congress acted because the Office of Inspector General within the Department of Health and Human Services had found that the provision of personal care services, in particular, was prone to abuse as well as having insufficient protects in place to protect vulnerable beneficiaries from sub-standard care.

As indicated above, the provision will take effect soon for personal care services.  CMS is already moving quickly to provide guidance to states, and states are in turn responding with their plans (see Ohio, Hawaii and Texas – for examples.) Interested parties (beneficiary advocacy organizations, providers and vendors) should monitor these developments closely.


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